Good morning. Microsoft Corp.’s $26.2 billion offer for LinkedIn Corp. is forcing chief information officers, once again, to reconsider the social enterprise, a concept that always seems to be just around the corner. Adoption so far has failed to live up to forecasts, in part because available tools haven’t been able to translate into a business context. But some IT executives and analysts tell CIO Journal’s Steven Norton and Angus Loten that this time it may be different because the deal combines many of the tools already at their disposal—from dusty old email, which refuses to die, to LinkedIn’s social network.

The key word here could be “integration,” not adoption. As the Journal’s Jay Greene writes, the deal would integrate LinkedIn’s trove of corporate information with Microsoft’s productivity, collaboration and customer relationship management tools. For example, connecting LinkedIn to Microsoft Office could help meeting attendees learn more about one another directly from their calendar invitations.

“The ability to cross over from the enterprise and be able to access a network like LinkedIn will go a long way,” Bank of New York Mellon Corp. CIO Suresh Kumar tells CIO Journal. Integrating the two firms’ offerings “could let a company leverage the knowledge or relationships of employees a lot more easily.”

The acquisition “speaks to how social media tools are becoming mainstream in the enterprise and how employees conduct business every day,” said Steve Phillips, CIO at Avnet Inc. How do you see an integrated Microsoft, LinkedIn experience playing out in your organization? Let us know.

Eli Lilly names new CIO. The pharmaceutical company, withouta CIO since the resignation of Ina Kamenz earlier this year, has promoted Aarti Shah to the position. Dr. Shah has held several technology and information sciences roles since she joined the pharmaceuticals company in 1994, most recently serving as global brand development leader for immunology in an Eli Lilly business unit. She is due to start as CIO July 1.

SECURITY AND PRIVACY

Flight controls are seen inside the cockpit of an Airbus A350-900 aircraft. The preliminary agreement would include new in-flight warnings.

Bloomberg News

Pilots may soon see cockpit alerts about hacks to safety systems. Government and airline experts have reached a preliminary agreement on airline cybersecurity standards, according to people familiar with the matter. An entirely new category of automated in-flight warnings is underway, reports the WSJ’s Andy Pasztor. That includes notifications to pilots if navigation signals are jammed or corrupted, going beyond protections built into modern planes.

U.S. sees progress in latest cyber talks with China. The two are working to set up an email address through which to share information about cybersecurity attacks, according to Reuters. China, Russia and Iran are among what the United States believes are its most prolific and sophisticated hacking adversaries. China and the U.S. signed an anti-hacking agreement last September.

Apple’s ‘differential privacy’ to help collect user data while protecting privacy. Using statistics, subsampling and other analytics techniques, Apple Inc. is researching how to collect data about customers to improve software, even as it avoids building user profiles, the company said at its developer conference Monday, writes Wired. “Differential privacy…seeks to mathematically prove that a certain form of data analysis can’t reveal anything about an individual—that the output of an algorithm remains identical with and without the input containing any given person’s private data,” writes Wired.

Technology busiest sector in merger deals this year. Including Symantec Corp.‘s $4.65 billion agreement to buy Blue Coat Systems Inc. and the $26.2 billion Microsoft, LinkedIn deal, there have been about $260 billion of tech deals announced globally so far this year, according to Dealogic data. That is the second-fastest pace ever for the period, after 2000, the Journal’s Rolfe Winkler and Anne Steele report. Technology is the busiest sector for M&A this year, as it was in 2015, the data show.

That $26.2 billion by the numbers. Buying LinkedIn is a gamble and no bargain, the WSJ’s Dan Gallagher says. The deal’s stated value represents about 37% of Microsoft’s last reported cash balance, net of debt. The New York Times notes that the figure represents for $220 for each of LinkedIn’s monthly active users. Facebook Inc. spent $40 per user when it paid $19 billion for WhatsApp, the NYT adds.

Supreme Court makes it easier to win big damages for severe patent violations. The Supreme Court on Monday made it easier for patent holders to win increased financial damages in court from copycats who use their inventions without permission. As the Journal’s Brett Kendall reports, some top technology companies like Facebook Inc. and Alphabet Inc.’s Google have argued in the past that strict limits on large-damage awards protect innovation and deter abusive patent-infringement lawsuits.

PayPal joins Fortune 500, bets $890 million on immigrants. The payments company’s Xoom app is aimed at immigrant workers in the U.S. who want to regularly send money home, writes Fortune. PayPal paid $890 million a year ago to buy Xoom, which can make cross-border payments in 53 countries. The company says the service is safer and cheaper than using a traditional money-transfer service.

Sony gets real about virtual-reality launch.The company plans to launch a VR headset for its PlayStation console Oct. 13, priced at $399. Sony Corp. is playing catch-up to Facebook Inc.’s Oculus Rift and HTC Corp.’s Vive,writes the Journal’s Takashi Mochizuki. “Star Wars” and “Batman Arkham” are expected to be among the titles for the new device.

Automation, not cheap labor, is reshaping outsourcing. Companies are starting to consider the level of automation an offshore outsourcer can provide, rather than simple the wage differential between U.S. and other IT workers,writes Computerworld. Robotic process automation, which uses software to govern routine IT tasks, is one draw, with Tata Consultancy Services, Infosys and Wipro working on intelligent agents.

Xbox addresses gamer harassment with new features. Microsoft will let users of its Xbox Live gaming service create their own virtual spaces called Clubs, giving players the ability to form groups of gamers around the globe and control their membership, the WSJ’s Jay Greene and Sarah Needleman report. The move comes on the heels of media coverage spotlighting sexist and racist harassment in the online gaming community.

APPLE’S WWDC 2016

Apple outlines Siri improvements.Apple Inc. said it was releasing a software development kit for Siri that would let outside developers knit the voice-activated digital assistant with apps, the WSJ’s Daisuke Wakabayashi reports. The company said Siri would be available on its Mac computers through the latest version of its operating system, which it has dubbed macOS Sierra. The company also opened Messages to outside developers, in line with a growing trend among messaging platforms, including Facebook’s Messenger and Tencent Holdings Ltd.’s WeChat, to serve as a gateway to myriad other services.

Too little, too late? Some wonder if Apple’s decision to wait five years before opening up Siri has hurt its chances against competitors like Amazon.com Inc.‘s Alexa which is already open to developers. “Is it too little too late?” Oren Etzioni, CEO of the Allen Institute for Artificial Intelligence, asks Reuters. “Siri is five years old and still trying to learn how to play well with others.”

Apple Watch to get faster OS. Apple’s upcoming WatchOS 3 lets apps load data in the background to speed up launches and address a major gripe Apple Watch users have with their device, the WSJ’s Nathan Olivarez-Giles reports. The OS update will also make it easier for wearers to access a control center and includes a new feature called Scribble where users can scrawl letters with their fingers.

Welcome Mac. Apple’s Mac operating system has been called OS X for the last 15 years—but no longer. The company announced Monday that going forward, Macs will run MacOS, bringing back the classic name to go with iOS on iPhones and iPads, WatchOS on Apple Watches and TvOS on the AppleTV. The latest version of the operating system will be called MacOS Sierra, reports the WSJ’s Mr. Olivarez-Giles.

EVERYTHING ELSE YOU NEED TO KNOW

Port strikes, energy woes, slow cash conversion. The West Coast ports strike, weak oil and gas prices and changes in corporate supply chains made U.S. companies less efficient last year, says consulting firm Hackett Group Inc. On average, 1,000 of the largest nonfinancial public companies in the U.S. took 35.6 days during their 2015 fiscal years to convert each dollar tied up in raw materials, overhead and labor into a dollar of sales, Vipal Monga repots in the Big Number. That’s 2.4 days more than the previous year and the longest lag time since before the financial crisis, Hackett said.

Consumer spending should translate to nice retail sales. American consumers appear to be feeling pretty good; if only the average retailer could say the same thing. U.S. consumer spending recently rose at its fastest pace in nearly seven years. All of that should bode well for Tuesday’s retail-sales report, one of the last major data points prior to this week’s Federal Reserve policy meeting. While the headline figures aren’t expected to be as good as last month’s report, the data should show healthy consumer spending and the growing bifurcation between struggling brick-and-mortar retailers and thriving internet outlets.

Got a good deal in the city.McDonald’s Corp. is moving its headquarters to downtown Chicago from the suburbs, as more companies move into urban centers to attract workers. The company said it would move HQ to the trendy West Loop neighborhood of Chicago by 2018. Companies like General Electric Co., Weyerhaeuser Co. and, now, McDonald’s, are moving to urban high-rises to attract younger workers. Young, educated and relatively high-earning workers are flocking to many American cities at a rate not seen since the 1970s.